Earlier this month, the Bank of Japan said it planned to double its holdings of government bonds and ETFs the next two years. Bank of Japan Governor Haruhiko Kuroda said he will do whatever it takes to meet the 2% inflation target. [BOJ Bombshell: Yen ETF Plummets, Japan Stocks Soar]
DXJ has been a favorite among institutional investors positioning for higher Japanese stocks and a weaker yen. For example, Jeffrey Gundlach, manager of the DoubleLine Total Return Bond Fund, late last year said one of his high-conviction investing ideas was to buy Japanese stocks and short the yen. He predicted the Japanese government would debase the yen to stimulate the economy and the stock market. [Japan ETF Falls to 2012 Low Before Election]
Some Wall Street analysts say it’s still not too late to buy Japan ETFs. Analysts at Credit Suisse are advising clients to add to Japanese equity holdings, MarketWatch reports. They cited BOJ policy, economic growth, allocation shifts, restructuring potential and valuations.
DXJ is up about 51% the past six months while EWJ has rallied 29% over the same period.
WisdomTree Japan Hedged Equity
